Middle Class Fleeing CA at Record Rates

http://www.dreamstime.com/-image14115451New data has brought a new urgency to the souring fortunes of California’s middle class.

“Not only are Californians leaving the state in large numbers, but the people heading for the exits are disproportionately middle class working families — the demographic backbone of American society,” the American Interest recently noted.

Looking at labor force categories provides more evidence that California is losing working young professional families,” argued Hoover Institution research fellow Carson Bruno; “while there is a narrative that the rich are fleeing California, the real flight is among the middle-class.”

“Knowing that net out-migrants are more likely to be middle-class working young professional families provides some hints as to why people are leaving California for greener pastures. For one, California is an extraordinarily high cost-of-living state. Whether it is the state’s housing affordability crisis — California’s median home value per square foot is, on average, 2.1 times higher than Arizona, Texas, Nevada, Oregon and Washington’s — California’s very expensive energy costs — the state’s residential electric price is about 1.5 times higher than the competing states — or the Golden State’s oppressive tax burden — California ranks 6th, nationally, in state-local tax burdens — those living in California are hit with a variety of higher bills, which cuts into their bottom line.”

Real estate indicators

“In 2006, 38 percent of middle-class households in California used more than 30 percent of their income to cover rent. Today, that figure is over 53 percent,” according to Christopher Thornberg, director of the UC Riverside School of Business Administration Center for Economics Forecasting and Development. “The national figure, as a point of comparison, is 31 percent. It is even worse for those who have borrowed to buy a home — over two-thirds of middle-class households with a mortgage are cost-burdened in California — compared to 40 percent in the nation overall.”

Recent studies illustrated a continuing plunge in homeowning among traditional buyers in-state. “California’s middle class is being hammered,” wrote Joel Kotkin at the Orange County Register. “The state now ranks third from the bottom, ahead of only New York and the District of Columbia, for the lowest homeownership rate, some 54 percent, a number that since 2009 has declined 5 percent more than the national average.”

Low on houses

Some analysts looking to explain the trend have pointed to a so-called housing shortage statewide. “With supply falling far below demand, California needs to build at least 1 million more homes for low- and middle-income Californians in the next 10 years,” CAFWD suggested, adding that, although Gov. Jerry Brown “did not mention housing in the State of the State address,” he has “not explicitly ruled out addressing the issue in the next three years.”

Giving ammunition to the housing shortage thesis, meanwhile, was “a new report from the California Legislative Analyst’s Office that found that poorer neighborhoods that have added more market-rate housing in the Bay Area since 2000 have been less likely to experience displacement,” the Washington Post noted. But experts have differed significantly on how to read the tea leaves of the data, and analysts disagree on whether increasing density — or what kind of density — is the right answer.

A cloudy picture

The Golden State has been haunted in recent times by sharply mixed economic indicators. “While California has added 2.1 million jobs since 2010, employment in six industries is still below 2007 levels, before the Great Recession, according to the center’s analysis. Those sectors — including construction, finance and manufacturing — generally pay more than the service-type jobs that we’re adding in droves,” the Sacramento Bee noted late last year.

Economic growth concentrated in Silicon Valley has also not done much to relieve the income or jobs picture for middle-classers. “In a recent survey of states where ‘the middle class is dying,’ based on earning trajectories for middle-income cohorts, Business Insider ranked California first, with shrinking middle-class earnings and the third-highest proportion of wealth concentrated in the top 20 percent of residents,” Kotkin observed.

Originally published by CalWatchdog.com

Comments

  1. Why should hard working taxpayers that have WORK ETHIC that “Believe nothing is FREE in LIFE” stay in a State that gives taxpayer funds in Entitlements welfare and aid to Illegal Aliens and Mo Free Sh&t professional Welfare VOTERS for a Democrat PARTY VOTE?

  2. Will the last taxpaying adult working person leaving please turn out the lights and shut off the water.. Gov moonbat brown and his cadre of dysfunctional whacko islamo-crats (AKA-democrats) are destroying the state at a faster rate than ever thought possible! They have and will continue to have a death grip on politics in this single party dictatorship here in ka ka land! NO meaningful reforms or realistic problem solving will ever be accomplished so long as the brain dead 1960s hippy refugees have control of all facets of life here in CA! We are and will continue to circle around the cesspool drain of history and after state bankruptcy (and there will not be a federal rescue) will be no more than a footnote in history.

  3. Mike fournier says

    Time to go

  4. …..as went Detroit, so goes Kalifornia. And remember the next fools in line are Newsome and “Camel A” Harris. I’d leave also but I’m too old.

  5. Forgot to mention in the above article is the fact that gasoline here is “special”, so effing “special” that other States can’t (won’t) refine it. So when a refinery has a fire or disruption, up goes the price. And of course California’s Clown, Jerry Brown with his obsession with the non-happening “global warming” nonsense forced cap-n-trade down our throats adding god only knows how much more to the price of fuel.

  6. US "Citizen" says

    So we have no water, prices are high, utilities are high, roads are horrible, schools suck big time…………etc etc etc…………you have to think that building another 1 million homes is a good thing? Are you freaking serious!

  7. I would imagine along with the middle class escaping from California they will also take with them much of the education and technical knowledge with them, leaving a vacuum of skills which can only be filled, (if possible) by the influx of immigrants that are flooding the state. This could pose a serious problem for business owners in filling much needed skilled labor. And with the shortage of water there may not be much landscaping jobs needed. California leaders (progressives) are so very short sighted. One da they will be sorry for their actions.

    • “….much of the education and technical knowledge with them, leaving a vacuum of skills which can only be filled, (if possible) by the influx of immigrants that are flooding the state. ”

      Legally this should not be possible by employment verification, and possibly prosecutable through a class action lawsuit ( a illegal hiring discourager by whistleblowing disgruntled employees?).

  8. Yes, and this is the dream of Moonbeam’s. Exactly what he wants. A state with obedient residents (illegals/refugees) living with socialism. He has commandeered it perfectly and we did nothing to stop him.

  9. Robert Russell says

    I lived in the forest when Brown put the forest tax in place i moved to South Carolina in 2015. Taxes are only going to get worse in California as long as Democrats are in charge. Gasoline here in SC is $1.40 pg and everything else is cheaper best move i ever made but i lived in Cal all my life until last Nov. MR Trump vote for him he will know what to do about jobs our economy and illegals & everything else.

  10. We left California back in 2005 and now live in Idaho. It’s been amazing since then I have seen a lot of others from the area are here as well. For what we paid for our home and the size it would have been in the high 6 figures. Our insurance is a third cheaper and with a strong second amendment feeling our house is well guarded and its an open carry state. The cost of electricity is more than half the cost and so it goes, I do come for a visit but that’s about it. unless there is a change in the political climate I will only come our for a visit.

  11. California is headed towards economic collapse, as it has already experienced cultural and moral collapse. The only way out is to turn around and repudiate leftism, which means that it will never happen. I think California would sooner be split into different states than ever enact anything like common sense.

    Cruz 2016!!

    • “The only way out is to turn around and repudiate leftism, which means that it will never happen”
      Money doesn’t care, and would/shall catalyze the result.
      Further, whatever party in Sacramento in power will not permit the split of California for obvious partisan reasons.

  12. Both of my kids live out of state now. Both kids have lovely LARGE homes on 1/2 acre lots, in NOT crowded neighborhoods. Both kids are living large in their adopted states. Granted the weather is not great in the winter, but they say the “trade off is pretty good”. My daughter isn’t working now and can stay at home with the kiddo. I’ve sworn I’d never leave So Cal because of the weather. However, I’m looking over other places now.

  13. The way I see it, this insanity will not last very long. It will all come to a crashing end when a Conservative takes the WH and stops sending Jerry Federal Tax Money to keep this dog and pony show going. I believe it is going to hurt, and much will change…for the better with time…why? Because it is California…and people will always come here, that’s why. Just sit back, relax, watch the show…and pray.

  14. Hey guys, the middle class is coming to California! They coming from Florida, Texas and Massachusetts just to name a few. Why? The state budget is balanced and we are our way to lead the country in job growth until 2020!

  15. Ken Campbell says

    We’ve been seriously considering Nevada or Idaho but sadly the cancer of Socialism is slowly taking over even those states. Oregon and Washington are all but gone. As long as the LSM keeps pushing the ‘diversity’ ‘social justice’ mantra of the Left we’re all doomed in Kommieforniastan as they build their Soviet style apartments to house the compliant masses.

  16. Nubby McGuilicutty says

    Prop47 has ruined areas with tons of criminals and scumbags roaming our neighborhoods. I am leaving the state due to that alone. The rich and elite live behind their gates while we literally have to sit on our porches to guard our own homes. Stay away from California…

  17. I have news for everybody. For 38 years since I bought my first home affordability in California has always been an issue. When I bought my first home for $76,000 a 1300 square-foot three-bedroom two bath in Lake Forest California people told me I was crazy. And so it is all relative, because my wife and I were making about eight dollars an hour combined so the payment on $76,000 of about 750 bucks a month was a strain and so the story continues. Although I must say it does seem to be a little bit more difficult today. I guess it’s because incomes really have not kept up as well as they used to and blue collar jobs have eroded immensely.

  18. The new flag – a strung out, malnourished brown bear, bedded down in a marijuana bush.

  19. People actually praise Moonbeam bc he makes it look like he rescued CA financially. They’re clueless about the unfunded pensions that he is trying to ignore! Funny MSM has ignored it too.

  20. Randy Townsend says

    Mike, you stole my thunder. EXACTLY RIGHT – as long as the taxes get paid, the corrupt parasites in Sacramento couldn’t care less where the $ comes from. The unfunded liabilities (according to my sources) is closer to 700 billion (factoring in medical benefits along with pension costs). CA courts have ruled these benefits MUST be paid and cannot be reduced. I’ve got 3 years till the kid lets graduate from high school. After that, we’re out.

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